Market-At-A-Glance
National spending on healthcare increased to $3.6 trillion by 2018, representing 18% of U.S. total gross domestic product (GDP). Growth in hospital spending increased 4.1%, 0.8% lower than the growth in overall healthcare spending.

As of 2017, 30% of hospitals were losing money. Hospital executives cite government and payer constraints allowing costs to rise faster than revenues, and increased labor costs due to shortages.

In 2017, the ratio of hospital credit downgrades to credit upgrades exceeded that of the 2008 financial crisis.

One-Third Of 2017 Healthcare M&A Activity Involved
Health Systems
In a 2018 survey, 71% of healthcare executives reported an expected increase in M&A activities. The survey, based on 2017 activity, reported 33% of recorded deals involved health systems, and 19% involved hospitals. Each year, there are an average of 88 merger and acquisition (M&A) deals involving hospitals and health systems.

Both acquiring and acquired entities cited the top reasons for pursuing M&A as: improving access to capital, increasing market share, and delivering care more efficiently. Executives report it takes two years to reach these goals. Despite the lag in desired outcomes, executives largely agreed that M&A activity had an overall positive effect on their organizations.